USD/MXN Surges After Mexican Finance Minister Resigns

The Mexican peso sank versus the US dollar today amid political turmoil caused by the surprise resignation of Mexico’s finance minister. Nation’s consumer inflation slowed a bit last month but was not bad overall.
In a surprise move, Carlos Urzúa resigned from his office, writing a highly critical resignation letter. He cited disagreements with the government over economic issues as one of the reasons for his decision, saying:

Some of them were because this administration has taken public policy decisions without sufficient basis. I am convinced that economic policy must be based on evidence, taking into account the effects it could have, and without any extremism, whether of the right or left.

He also criticized appointment of officials, who had no necessary skill and experience and who had a conflict of interests.
The Consumer Price Index reported by the National Statistics Institute of Mexico rose at the annual rate of 3.95% in June, down from 4.28% in May. The actual reading matched forecasts exactly. The slowdown was not necessarily a bad sign for the economy as it brings inflation within the central bank’s target range of 2%-4%.
USD/MXN climbed from 18.9497 to 19.1541 as of 20:55 GMT today, touching the high of 19.3625 intraday. EUR/MXN declined from 21.7738 to 21.7157, retreating after the rally to the daily high of 21.8565.

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